Prime Minister Sergei Kirienko on 22
June promised that the government's economic program
for overcoming the latest financial crisis "will not be
carried out at the expense of the least well-off layers of
the population," ITAR-TASS reported. Speaking to
journalists after a Kremlin meeting with President Boris
Yeltsin, Kirienko said the "anti-crisis" program will include
unspecified mechanisms to protect the poorest citizens. In
an interview with Russian Television the previous evening,
Kirienko said the program will involve "quick, tough, and
often unpopular measures." Adopting it will require
"colossal political courage," he added, and implementing it
will require "colossal consolidation of all the forces and
resources of the authorities and society." On 22 June,
Yeltsin is to chair a discussion of the program at an
expanded session of the government, which will include a
large number of Federation Council and State Duma
deputies. LB

IMF TEAM TO ARRIVE IN MOSCOW FOR TALKS

An IMF
delegation headed by the fund's First Deputy Managing
Director Stanley Fischer are to arrive in Moscow on 22 June
for talks with Russian officials on the disbursement of a
$670 million loan tranche and a possible new multibillion-
dollar loan to help calm Russian financial markets (see
"RFE/RL Newsline," 19 June 1998). Unified Energy System
chief executive Anatolii Chubais, Yeltsin's envoy to
international financial institutions, said Russia will
negotiate a $10 billion to $15 billion loan under the IMF's
Supplemental Reserve Facility program. But speaking to
reporters in Konakovo (Tver Oblast), Chubais said "my
impression is that we will not need to spend most of these
funds," Reuters reported. The same day, Yeltsin told
journalists in Kostroma that Russia needs "trust," not cash,
from foreign leaders and international financial
institutions. LB

DUMA EXPRESSES CONCERN ABOUT FOREIGN
BORROWING

The Duma on 19 June passed a statement
saying Russia's foreign debt "has gone beyond reasonable
limits, exceeding $135 billion, and has become a direct
threat to the state's economic and political sovereignty,"
Russian news agencies reported. Before the vote, Duma
Budget Committee Deputy Chairman Vladimir Nikitin of the
Popular Power faction told deputies that Russia "has
almost exhausted" its limit on foreign borrowing for 1998
and that "further borrowing will require legislative
approval." But an unnamed Finance Ministry official told
Interfax that the Duma does not have the right to limit the
government's foreign borrowing. The official said a bailout
package from the IMF would not necessarily increase
Russia's foreign debt since the stabilization funds might
never be spent. Russian officials hope the psychological
impact from additional IMF support would calm the
markets. LB

KREMLIN OFFICIAL SAYS YELTSIN'S FUTURE PLANS
NOT DECIDED YET

An unnamed high-ranking official in the
presidential administration on 20 June said Yeltsin has not
yet made a final decision on whether to run for re-election
again in 2000, Interfax reported. The source said the
president will determine his future plans only after the
Constitutional Court rules on whether he is legally entitled
to seek another term. The Kremlin official also argued that
the media "too categorically" interpreted Yeltsin's recent
comments in which he ruled out another presidential bid
(see "RFE/RL Newsline," 19 June 1998). Last fall, the Duma
asked the Constitutional Court to rule on whether Yeltsin
may run for president again. The court is expected to
consider the case in late 1998. LB

NO WORD FROM YELTSIN ON BUSINESS ADVISORY
COUNCIL

An unnamed source in the presidential
admnistration told Russian news agencies on 20 June that
Yeltsin has yet to approve the formation of a so-called
Council of Mutual Economic Assistance, on which leading
businessmen will advise the government. The source said
such a council could be formed in July at the earliest. On 19
June, ITAR-TASS quoted an unnamed source who attended
the previous day's meeting between Prime Minister
Kirienko and the "oligarchs" as saying that the government
and business leaders have already agreed to form an
advisory council. The next day, Kirienko told journalists
that the government welcomes efforts by financial and
industrial groups to advance "constructive cooperation"
with the cabinet," Russian news agencies reported.
Speaking to Russian Television on 21 June, Kirienko said
the government will not accept all the businessmen's
policy proposals. LB

DUMA FORMS COMMISSION TO STUDY GROUNDS FOR
IMPEACHMENT

The Duma on 19 June voted to set up a
commission to study criminal allegations against Yeltsin
and draft an impeachment motion if it deems those
allegations valid, RFE/RL's Moscow bureau reported.
Communist deputy Vadim Filimonov is to head the
commission, whose 15 members will include
representatives from all seven Duma factions. Duma First
Deputy Speaker Vladimir Ryzhkov of Our Home Is Russia,
who will join the commission, explained that while his
faction opposes efforts to impeach Yeltsin, it will
participate in the commission to keep apprised of its
activities and express dissenting opinions when necessary.
The commission will operate until the Duma votes on an
impeachment motion or until the end of the Duma's term, in
December 1999. Yeltsin's opponents would likely have
trouble gaining the two-thirds majority vote needed to
adopt an impeachment motion. LB

WHO IS BEHIND IMPEACHMENT EFFORTS?

Although
Communist leaders have been outspoken supporters of
ousting Yeltsin, the 15 June edition of the weekly magazine
"Profil" argued that "oligarchs" testing their strength
against the president are behind the Duma's latest
impeachment efforts. The weekly quoted Duma Deputy
Speaker Mikhail Gutseriev of the Liberal Democratic Party
of Russia as saying that bankers are using their money and
influence to promote the creation of an impeachment
commission in the hope of encouraging Yeltsin to confirm
that he will not seek a third term. Duma deputy Vladimir
Semago, a maverick member of the Communist faction,
told "Profil" that the formation of a commission on
impeachment would signify "the active interference of
bankers in political affairs, not the strengthening of the
left wing of the Duma." Bank Imperial, reportedly close to
the gas monopoly Gazprom, is a shareholder in "Profil." LB

ZYUGANOV CALLS FOR OUSTING YELTSIN,
PRESERVING PARTY UNITY

Communist Party leader
Gennadii Zyuganov on 20 June said his party will seek to
use "all legal means" to remove Yeltsin, Russian news
agencies reported. Addressing a plenum of the Communist
Party's Central Committee in Moscow, Zyuganov hailed the
creation of a Duma impeachment commission and said
Communists will prepare for a nationwide political protest.
(Critics of Zyuganov's party, in particular members of
Grigorii Yavlinskii's Yabloko movement, have accused the
Communists of using the impeachment procedure to quell
discord within their own ranks and help erase memories of
the Communist votes that helped confirm Kirienko as
prime minister in April.) Zyuganov also announced that the
presidium of the Central Committee has said that attempts
to create a "Leninist-Stalinist platform" within the party
are "politically erroneous" and has dissolved that platform,
founded recently by more radical party members (see
"RFE/RL Newsline," 25 May 1998). LB

RUSSIA-INDIA SIGN NUCLEAR REACTOR PROTOCOL

Russian Minister for Atomic Energy Yevgenii Adamov and
Indian Nuclear Energy Commission Chairman R.
Chidambaram signed a protocol on 21 June whereby Russia
will provide two light water reactors to India, ITAR-TASS
reported. The original agreement had been signed in 1988
between the Soviet Union and India, but differences over
the means of payment delayed implementation of the deal.
The protocol was due to be signed on 22 June, but Adamov
said the two sides reached agreement quickly so "I signed
the additional protocol [on 21 June] with a light heart." The
agreement to provide two 1,000 megawatt reactors to the
Kudankulam project in Tamil Nadu is worth $2.6 billion.
Adamov also met with Indian Prime Minister Atal Behari
Vajpayee in Simla and "confirmed the solidity of our roots
of friendship and partnership." BP

FOREIGN MINISTRY LAUDS U.S. OVERTURES TOWARD
IRAN

The Russian Foreign Ministry on 19 June issued a
statement welcoming Washington's recently announced
intention to normalize relations with Iran, Russian news
agencies reported. The statement expressed the hope
that recent statements by U.S. President Bill Clinton and
Secretary of State Madeleine Albright will be followed by
"practical steps," namely that the U.S. will "abandon
attempts to apply their legislation abroad...to impede
Iran's trade and economic cooperation with other countries
and to expose them to sanctions." On 17 June, Albright
offered Iran new confidence-building measures, while the
next day, Clinton called for "genuine reconciliation" with
Iran, Reuters reported. The U.S. has voiced objections to
Russian-Iranian cooperation in the energy sector,
particularly to Russia's recent sale of technology for the
Bushehr nuclear reactor (see "RFE/RL Newsline," 12 and 26
May 1998). BT

DUMA DEPUTIES SEND MIXED SIGNALS ON START-2
RATIFICATION

The Duma will ratify the START-2 treaty,
Chairman of the Duma Defense Committee Roman
Popkovich (Our Home is Russia) predicted in an interview
with the weekly "Interfax-Argumenty i Fakty," published on
22 June. However, Popkovich told a news conference on 19
June that "the agreement as it exists now is hard to ratify."
Among preconditions he views as necessary for
ratification are a government report on compliance with
START-2, a protocol attached to START-2 outlining future
START-3 negotiations, and a provision stating that Russia
would automatically opt out of START-2 if the U.S. violated
the 1972 Anti-Ballistic Missile Treaty. Meanwhile, Duma
deputy Andrei Nikolaev, the former director of the Federal
Border Service, has expressed his support for START-2
and predicted that the treaty will be ratified in September
or October, ITAR-TASS reported on 19 June. Earlier this
month, the Duma postponed START-2 hearings until the fall
session (see "RFE/RL Newsline," 10 June 1998). BT

CHECHEN SECURITY CHIEF KILLED IN SHOOT-OUT

Lechi
Khultygov, the head of the Chechen Security Service and
Vakha Dzhafarov, chief of staff to field commander Salman
Raduev, were killed during a shoot-out in Grozny on 21
June, ITAR-TASS reported. The day before, Interfax
reported that the kidnappers of Valentin Vlasov, Yeltsin's
envoy to Chechnya, had demanded a $2 million ransom for
his return; but Chechen Interior Minister Kazbek Makhashev
denied that report, according to ITAR-TASS. PG

YELTSIN WARNS OF FAR-RIGHT EXTREMISM

Yeltsin on
22 June warned that the threat of far-right extremism in
Russia "is a real danger, even if not everybody feels it,"
Interfax reported. In a nationwide radio address to mark
the 57th anniversary of the Nazi invasion of the USSR,
Yeltsin warned that "Nazism is surging in Russia and
poisoning the youth. Teenagers, fascinated by military
symbolism, are modeling black uniforms." He criticized
those who are "crazed with ideas of national supremacy and
anti-Semitism" and asked whether Russians will "allow the
worst ideology humanity has known to take root in this
soil." The weekly "Novaya gazeta" predicted in its 11-17
May edition the fascist threat will be used during the 2000
presidential election in the same way as the threat of a
Communist return to power was used in 1996 to encourage
voters to support Yeltsin's re-election. LB

BURYATIAN PRESIDENT WINS RE-ELECTION EASILY

Leonid Potapov beat out nine challengers to win a second
term as president of the Republic of Buryatia with some 63
percent of the vote, ITAR-TASS reported, citing
preliminary returns from the 21 June election. Vladimir
Saganov, the chairman of the Budget Committee of the
Buryatian legislature, finished a distant second with 6.5
percent. Potapov received a boost when Aleksandr
Korenev, the president of Buryatia's Union of Industrialists
and Entrepreneurs, who was considered a strong
presidential candidate, dropped out of the race on 18 June
and endorsed the incumbent. Although Potapov supported
Yeltsin's re-election in 1996, he has not always backed the
federal government's economic policies. Earlier this year,
he criticized efforts to legalize the purchase and sale of
farmland and scheduled a referendum on land reform in
Buryatia for 21 June. He later postponed that vote until 5
July, Interfax reported. LB

COMMISSION CONFIRMS ALTAI BY-ELECTION RESULT

The Central Electoral Commission on 19 June confirmed
that Agrarian Party leader Mikhail Lapshin won a 31 May
by-election in Altai Republic for a seat in the State Duma,
Russian news agencies reported. At the request of former
First Deputy Finance Minister Andrei Vavilov, who lost the
race by a slim margin (see "RFE/RL Newsline," 1 June 1998),
the commission sent a team to Altai to investigate
allegations of foul play during the election. They found
isolated violations of electoral rules but determined they
were not widespread enough to have influenced the
outcome. Vavilov's campaign had far greater financial
backing than Lapshin's, and the former Finance Ministry
official also had the support of the republic's leader,
Semen Zubakin. LB

MORE TALKS ON SOUTH OSSETIA, ABKHAZIA

Georgian
President Eduard Shevardnadze and South Ossetian leader
Lyudvig Chibirov have agreed to continue discussions on
the status of that breakaway region following talks in
Borzhomi on 20 June, Interfax reported. The same day,
Russian First Deputy Foreign Minister Boris Pastukhov and
CIS Executive Secretary Boris Berezovskii met with
Shevardnadze in Tbilisi to discuss the situation in
Abkhazia, ITAR-TASS reported. The Russian
representatives claimed that there was progress in the
talks, but the Russian Defense Ministry on 19 June had
ordered Russian peacekeepers in that region to respond
with force if they are threatened, the Russian news agency
said. In a statement, the ministry blamed both sides for
"not taking the necessary measures to ensure the normal
functioning" of their troops. PG

BEREZOVSKII MAY VISIT KARABAKH...

Following a
meeting with Armenian President Robert Kocharian on 20
June in Yerevan, Berezovskii said that he has reached a
tentative agreement to visit Karabakh sometime later this
summer, RFE/RL's Armenian Service reported. The two men
also discussed increasing economic ties within the CIS.
Berezovskii told ITAR-TASS that he believes the "oil
factor" will have little impact on the settlement of the
Karabakh conflict. PG

...EXPRESSES OPTIMISM ON RESOLVING CONFLICT

The
following day, the CIS executive secretary met with
Azerbaijani President Heidar Aliyev in Baku and expressed
optimism that progress can be made toward resolving the
Karabakh conflict, ITAR-TASS said. Berezovskii said that
CIS leaders should say "no" to separatism throughout the
region, and he urged Armenia to take a clear position on
the future status of Karabakh. Saying that he welcomes
these ideas, Aliyev expressed the hope that the OSCE Minsk
Group process could continue. The previous day, the
Azerbaijani Foreign Ministry released a statement
criticizing an alleged remark last week by Armenian
Foreign Minister Vartan Oskanyan that Yerevan plans to
annex Karabakh. The Armenian authorities have denied that
Oskanyan made such a comment. PG

ARMENIAN PRESIDENT SETS UP CONSULTATIVE
GROUP

President Robert Kocharian on 19 June issued a
decree establishing a special consultative council that will
include representatives from the country's major parties
regardless of whether they are represented in the
parliament, RFE/RL's Armenian Service reported. The
council's decisions will not be legally binding. As yet,
there is no system for selecting its members. PG

ARMENIA GRATEFUL FOR RUSSIAN HELP AT NUCLEAR
STATION

Acknowledging that Armenia lacks the ability
to operate the nuclear power station at Metzamor without
assistance, the plant's director, Suren Azatyan, on 20 June
told a group of visiting nuclear expects from Russia that
his country appreciates their continuing assistance, ITAR-
TASS reported. Azatyan said there have been no accidents
at the plant since it was reopened three years ago. H added
that there will be routine repair and reloading operations
this fall. PG

ARMENIA SEEKS TO JOIN EUROPE

President Kocharian
on 19 June told a visiting delegation from the Council of
Europe that "integration into European structures" is a top
priority for his government, RFE/RL's Armenian Service
reported. "Armenia must become the most democratic
nation in the Transcaucasus since democracy
predetermines the future of the country," he commented.
Meanwhile, some 2,500 Armenians demonstrated in
Yerevan against the sale of the country's brandy distillery
to Pernod-Ricard of France, Interfax reported. But
Kocharian said that the country cannot afford to block the
sale lest it "find itself left out of global economic
processes." PG

NEW UN ENVOY ARRIVES IN TAJIKISTAN

The new UN
special envoy to Tajikistan, Jan Kubis, presented his
credentials to Tajik President Imomali Rakhmonov in
Dushanbe on 19 June, ITAR-TASS and Reuters reported.
Kubis said the compromise reached by a special
commission and Rakhmonov after the Tajik parliament
adopted a law banning religious parties last month is a
"positive step" in maintaining the peace process in
Tajikistan. Kubis met with United Tajik Opposition leader
Said Abdullo Nuri the following day to discuss the law
banning religious parties as well as "military aspects" of
the Tajik peace agreement. Kubis assessed the peace
process as slowly moving forward but added that
"sometimes it comes to a standstill and becomes
problematic." BP

SIX BORDER GUARDS KILLED IN TAJIKISTAN

Six border
guards, five Tajiks, and one Russian were killed on 20 June
while attempting to prevent drug traffickers from crossing
into Tajikistan from Afghanistan, ITAR-TASS reported.
Three people were also wounded in the incident The drug
traffickers escaped, and border guards have launched a
search for them. According to ITAR-TASS on 20 June, more
than 140 kilograms of narcotics have been seized by
border guards in the "last few days." BP

BELARUS CUTS OFF UTILITIES AT DIPLOMATIC
COMPOUND

Minsk toughened its stance in the row over
the Drazdy compound on 19 June by cutting off water,
electricity, and telephone services to diplomatic
residences (see "RFE/RL Newsline," 19 June 1998). The
police set up checkpoints at roads leading to Drazdy and
are allowing only vehicles with special passes to enter the
compound. The authorities, however, have made no
provision for issuing such passes, U.S. State Department
spokesman James Rubin told a briefing in Washington on 19
June. JM

FIVE EU COUNTRIES, U.S. RECALL AMBASSADORS TO
MINSK.

Ambassadors to Minsk from five EU countries--
Britain, France, Greece, Italy, and Germany--are to return
home on 22 June for consultations with their governments
over Minsk's attempt to evict them from their residences.
Germany has taken a further step by demanding that the
Belarusian ambassador to Bonn leave immediately, dpa
reported. German Foreign Minister termed Minsk's action in
the Drazdy affair as "unprecedented in the history of
diplomacy" and said the Belarusian government is "rapidly
maneuvering itself into isolation." On 22 June, the U.S.
announced it is also recalling its ambassador for
consultations. JM

RUSSIA TO LEAVE AMBASSADOR IN MINSK

Russian
Foreign Minister Yevgenii Primakov has said the Russian
ambassador to Belarus will not be recalled in connection
with the conflict over the Drazdy compound. "But of course
we will react in some way," ITAR-TASS quoted him as
saying. "Our Belarusian friends and brothers are not acting
via diplomatic means," he stated. JM

KUCHMA SIGNS SEVERAL EMERGENCY ECONOMIC
DECREES

Following his recent announcement on national
television (see "RFE/RL Newsline," 19 June 1998), the
Ukrainian president has signed several emergency
economic decrees easing taxes and other payments to the
state, Interfax reported. Employers' obligatory payment to
a state fund for the consequences of the Chornobyl
accident has been reduced from 10 percent to 5 percent of
the wage fund. A single tax on agricultural produce
replaces 10 such taxes. And 1.25 billion hryvni ($620
million) has been allocated to pay back wages, pensions,
and social benefits. JM

DONETSK MINERS DEMAND BACK WAGES

Following the
Ukrainian government's deal with the Dnipropetrovsk to
pay back wages (see "RFE/RL Newsline," 18 June 1998), a
group of miners in Donetsk has begun picketing the oblast
administration building to demand payment of their
outstanding wages. Coal Industry Minister Serhiy Tulub has
appealed to the miners to end their protest, ITAR-TASS
reported on 19 June. Meanwhile, a Donetsk miners trade
union has demanded that Tulub be held responsible for
issuing a directive to coal mining managers to freeze funds
allocated to pay overdue wages and benefits. JM

NATO SECRETARY-GENERAL IN TALLINN

Javier Solana
told Estonian Prime Minister Mart Siimann in Tallinn on 19
June that Estonia can best approach NATO by increasing its
military cooperation with other countries, BNS and dpa
reported. He also told Estonian leaders that a drive to
increase defense spending will not necessarily improve
their country's chance of joining the alliance. "The main
problem is for you to develop your cooperation ability,
language [and] communication skills, and management
techniques," Solana said. The NATO chief was wrapping up a
tour of all three Baltic States (see "RFE/RL Newsline," 19
June 1998). JC

ULMANIS POSTPONES TRIP FOR DEBATE ON
CITIZENSHIP LAW

Latvian President Guntis Ulmanis has
postponed his departure for a NATO seminar in Vienna,
saying he plans to be in Riga on 22 July when the
parliament discusses amendments to the country's
citizenship law, BNS reported. Ulmanis told U.S.
Undersecretary of State Strobe Talbott in a telephone
conversation on 19 June that he hopes lawmakers will
approve the amendments, which will ease restrictions on
granting citizenship to non-Latvians. JC

POLISH TRAIN DRIVERS SUSPEND STRIKE

The Trade
Union of Train Drivers on 20 June suspended its strike over
pay increases and early retirement (see "RFE/RL Newsline,"
17 June 1998). The government has agreed to review the
wage scale for railroad workers but refuses to discuss
early retirement plans. The 22 June "Zycie" reported that
the trade union suspended the strike following government
threats to resort to mass layoffs if the protest is
continued. Normal railroad traffic is expected to be
restored on 22 June. JM

POLISH PRESIDENT TO VETO BILL ON ADMINISTRATIVE
REFORM

Presidential aide Danuta Hubner has said
Aleksander Kwasniewski will veto the bill on dividing the
country into 15 administrative provinces. The upper house
of the parliament amended the lower house's bill providing
for 12 new provinces in Poland by increasing that figure to
15. Hubner said the president supports the opposition
Democratic Left Alliance's proposal to set up at least 16
provinces. If Kwasniewski vetoes the bill, the Solidarity-
led government will suffer a serious setback in its drive
for administrative reform since it does not have the two-
thirds parliamentary majority necessary to override the
presidential veto. JM

SOCIAL DEMOCRATS WIN CZECH ELECTIONS...

The Social
Democratic Party (CSSD) will be the largest formation in
the new Chamber of Deputies, having won 32.3 percent of
the vote and 74 seats in the 200-strong chamber in the 19-
20 June elections, Reuters reported. The Civic Democratic
Party (ODS) came second with 27.7 percent and 63 seats,
followed by the Communist Party of Bohemia and Moravia
(11 percent and 24 seats), the Christian Democrats (KDU-
CSL, 9 percent and 20 seats) and the Freedom Union (8.6
percent and 19 seats). The far-right Republican Party (3.9
percent) and the Pensioners' Party (3 percent) will not be
represented in the chamber. MS

...BUT MAY BE UNABLE TO FORM COALITION

"Mlada
Fronta Dnes" on 21 June noted that CSSD chairman Milos
Zeman "has most of the votes but has not won." Observers
doubt the CSSD will be able to form a coalition, for which it
would need the support of the KDU-CSL and the Freedom
Union. Zeman said the same day that he will let the party
decide whether it should form a coalition with the KDU-CSL
and the Freedom Union, but he added that he is not in favor
of a coalition with the Freedom Union. Freedom Union
leader Jan Ruml, for his part, has ruled out a coalition with
the CSSD, while KDU-CSL leader Josef Lux is opposed to a
coalition with the CSSD alone, since the government would
depend on the backing of the Communists. Both ODS leader
Vaclav Klaus and Zeman have ruled out a "grand coalition."
President Vaclav Havel on 22 June begins consultations
with the leaders of the parties that gained entry to the new
parliament. MS

SLOVAKIA'S ETHNIC HUNGARIAN PARTIES MERGE

Slovakia's three ethnic Hungarian parties formally merged
on 21 June to form the Hungarian Coalition Party. Bela
Bugar of the Hungarian Christian Democratic Movement was
elected chairman of the new party, and Miklos Duray of the
Co-existence Party honorary chairman. The congress also
decided that the former Hungarian Civic Party will name an
executive deputy chairman. That post is likely to be filled
by Laszlo Nagy, whose resignation last week as chairman of
the Hungarian Civic Party was rejected by the formation's
presidium, RFE/RL's Bratislava bureau reported. MS

HUNGARY'S FREE DEMOCRATS ELECT NEW LEADER

The
20 June extraordinary congress of the Alliance of Free
Democrats (SZDSZ) elected Balint Magyar as the party's
new chairman, Hungarian media reported. Magyar said the
party's structure and political style must be renewed in
order to make the SZDSZ a strong liberal party. He said
entering a coalition with the Socialist Party was the right
decision but that the SZDSZ's mistake was its inability to
change its political strategy when it realized that it could
not implement its own principles. Commenting on the
composition of the newly elected executive body of the
party, Ferenc Koszeg, a founder of the party, said the
SZDSZ has rewarded those who are responsible for
unsuccessful policies. MSZ

PRIMAKOV BREAKS RANKS OVER KOSOVA

Russian
Foreign Minister Yevgenii Primakov told Russian Television
on 21 June that Belgrade cannot withdraw its forces from
Kosova unless there is a decrease in "terrorist activity."
Local Serbs would regard a withdrawal "right now" as a sign
to leave, and the result would be "a stream of Serbian
refugees," he said. Primakov stressed that the Kosovars
must stop resorting to violence and that talks between the
Serbian government and representatives of Kosovar
political parties must begin at once. The Contact Group
foreign ministers, including Primakov, have repeatedly
said in joint declarations that Serbia must withdraw its
forces immediately from Kosova. Yugoslav President
Slobodan Milosevic told Russian President Boris Yeltsin in
Moscow last week that he cannot withdraw his forces
without a decrease in "terrorism." At the time, U.S.
Secretary of State Madeleine Albright warned Milosevic
not to exploit differences between individual Contact
Group countries. PM

PRIMAKOV CLAIMS KEY ROLE...

Primakov also told
Russian Television on 21 June that his country is playing an
influential role in ending the crisis in Kosova. He noted that
NATO aircraft on recent exercises stayed at least 100
kilometers from the Serbian frontier, not out of fear of the
Yugoslav defense system, as Milosevic claimed, but
because NATO promised Russia it would do so. Primakov
noted that one Russian deputy foreign minister left for
Belgrade and Prishtina on 21 June for talks and that
another went on a mission to Tirana and Skopje. PM

...CHIDES U.S.

Primakov also blasted unnamed U.S. officials
"whose work directly involves Albania" for spreading "a
false report" from Kosovar refugees that Serbian forces
recently used a helicopter with Red Cross markings to
attack refugees (see "RFE/RL Newsline," 17 June 1998). He
called Albright "a sensible person" with whom he
nonetheless has "some differences.... I once told her, Russia
has been involved in the Balkans for 200 years, so how can
you think we know the situation there worse than you, the
Americans?" Primakov rejected Western calls for a
meeting of representatives of the Contact Group on 24
June and argued that the session should be postponed for a
week to see whether Milosevic has kept the promises he
made to Yeltsin (see "RFE/RL Newsline," 17 June 1998). PM

HOLBROOKE TO WARN MILOSEVIC

Albright told NBC
Television on 21 June that Richard Holbrooke, the U.S.
ambassador-designate to the UN, will visit Belgrade in the
next few days to impress upon Milosevic the importance
of his meeting the demands of the Contact Group, including
the withdrawal of Serbian forces from Kosova. PM

KOSOVAR POLITICIANS WANT CONTROL OVER UCK

Shadow-state President Ibrahim Rugova said in Prishtina
on 19 June that the Kosova Liberation Army (UCK) must
submit to the authority of the political leadership. He
added that the vast majority of UCK fighters are ordinary
citizens who want to defend their homes and property, the
"Frankfurter Allgemeine Zeitung" reported. Prime Minister
Bujar Bukoshi told the Belgrade "Dnevni telegraf" of 22
June that "the armed resistance of the UCK is a reality...and
it is necessary to place it under the control of political
institutions [and] bring the UCK into Kosova political life."
Previously, the Kosovar political leadership either made no
reference to the UCK or suggested it was invented by
Serbian security services to discredit the non-violent
political leadership. In Prishtina on 21 June, Parliamentary
Party leader Adem Demaci said his party wants to "serve
as the political wing of the UCK." PM

DESERTERS SAY TROOPS TOLD TO KILL CIVILIANS

Two
Yugoslav conscripts from Montenegro told Reuters in the
Albanian town of Bajram Curri on 21 June that they were
ordered to kill civilians. Fahrudin Muric and Fahrudin Avdic,
whose names suggest that they are Muslims from Sandzak,
said they deserted to the UCK five days earlier. The UCK
then helped them to flee to Albania and handed them over
to the OSCE. Muric quoted Yugoslav officers as telling
troops that "it is war and you have to kill civilians.... If you
do not kill them, they will kill you." Muric added that "I
decided to become a deserter because I did not want to
kill people on their doorstep." Avdic said: "We were told to
catch everyone who cannot defend themselves and then
either kill them or take them to prison." Meanwhile, an
RFE/RL correspondent reported from Podgorica on 22 June
that two additional Montenegrin conscripts have deserted
to the UCK. FS

BATTERED KOSOVARS SENT TO SERBIA

Three buses
containing beaten or otherwise badly injured Kosovars
passed through the Sandzak town of Novi Pazar on 21 June
en route to Serbia proper, an RFE/RL correspondent
reported from Prishtina, citing eye-witness reports from
Novi Pazar. Passers-by noticed the ethnic Albanians when
the buses stopped for repairs. Police chased away
onlookers who tried to approach the Kosovars, whose
hands were bound. PM

SERBIA KEEPS ALBANIAN FRONTIER CLOSED

Yugoslav
troops over the weekend continued to seal off the border
with Albania in the Tropoja region to prevent refugees
from fleeing (see "RFE/RL Newsline," 16 June 1998). A
spokesman for the United Nations High Commissioner for
Refugees said in Geneva on 19 June "that does not mean,
however, that people are no longer attempting to flee the
country." On 19 June, only 36 refugees made it across the
frontier on a mountain path, after waiting two weeks to
cross into Albania. Refugees who arrived in Tropoja earlier
in the week said that "thousands" of people are still
trapped inside Kosova. On 21 June, Reuters journalists on
the Albanian side of the border observed a Serbian tank
firing at a group of farmhouses near the border crossing of
Qafa e Morines and heavy exchanges of fire throughout that
day. FS

ALBANIAN LOCAL BY-ELECTIONS TAKE PLACE
WITHOUT INCIDENT

Albanians in seven municipalities and
nine smaller communities went to the polls on 21 June. The
turnout was only 35 percent in the southern city of Vlora
but reached 85 percent in some other areas. About 100
OSCE and Council of Europe monitors observed the voting.
Results are expected on 22 June. Local government
collapsed in the respective communities and municipalities
during unrest in February and March 1997. Officials
appointed from Tirana have been in charge of those areas
since mid-1997. FS

ROMANIAN HEALTH MINISTER RESIGNS

The leadership
of the Hungarian Democratic Federation of Romania (UDMR)
on 20 June accepted the resignation of Minister of Health
Francisc Baranyi, who earlier admitted having been forced
to sign a pledge to work as an informer for the communist
secret police. Baranyi said he was "a victim" rather than a
collaborator of the Securitate but has decided to "put
UDMR interests above my personal interests." The same
day, Prime Minister Radu Vasile announced all government
members must submit a written declaration saying
whether they worked for the Securitate. The leaderships of
the National Peasant Party Christian Democratic, the
National Liberal Party, and the Romanian Alternative party
are to demand that their leaders and parliamentary
representatives submit a similar declaration. MS

HEAVY FLOODS IN ROMANIA

President Emil
Constantinescu on 21 June cut short a visit to Austria and
flew back to Bucharest because of the heavy damage
caused by floods in his country. At least half of Romania's
41 counties are reported to be affected by the floods, with
most damage being registered in Transylvania. Reuters
reported on 19 June that the floods have caused the death
of 16 people, and at least seven more deaths were
reported on 21 June. Prime Minister Radu Vasile has
visited the affected areas. MS

BULGARIAN PRESIDENT ON RELATIONS WITH
YUGOSLAVIA

Petar Stoyanov, in an interview with the
Belgrade "Nin" magazine, said his country follows closely
developments in Kosova "because it does not want to be a
hostage of what is happening in Yugoslavia," BTA reported
on 19 June. Stoyanov said internal developments in
Yugoslavia "hinder bilateral relations" at present. He added
that the imposition of sanctions on Serbia were "a severe
blow" to Bulgarian economic reform efforts and encouraged
"arms trafficking and black marketing.". Stoyanov said that
for this reason, Bulgaria opposes the sanctions and that the
situation in Kosova cannot be viewed as an internal
Yugoslav problem alone because it encourages "the bad
image" of the Balkans as "a region where political emotions
run higher than they should." MS

CHUBAIS RETURNS TO GOVERNMENT, FOR NOW

by Stephanie Baker

Amid a deepening financial crisis, President Boris
Yeltsin has appointed former economic policy chief
Anatolii Chubais as his special envoy in charge of Russia's
relations with international lending organizations.

Chubais, who was sacked as first deputy prime
minister in March, returns to the government as Russia's
financial markets have been plunged into turmoil.

A Kremlin spokesman said Chubais will assume the
role of a deputy prime minister responsible for
negotiations with multilateral financial institutions, such as
the IMF. Yeltsin on 19 June said, however, that Chubais will
remain in government only temporarily to help Russia win
"certain support and investments." He said Chubais will
remain chief executive of national electricity company
Unified Energy Systems (EES).

Two days earlier, Prime Minister Sergei Kirienko had
announced that the government is hoping to tap additional
funds from the IMF to help prop up the Central Bank's
reserves, which have dwindled since Asia's financial woes
hit Russia last October. He emphasized that "It will not be a
new wasteful credit for consumption." And while he
declined to comment on the size of the loan under
discussion, other Russian officials have said it could be for
as much as $10 billion. An IMF team is due in Moscow next
week to discuss the new financial aid package.

Russia is battling one of its most serious financial
crises in years, which has sharply increased the
government's cost of borrowing to cover budget holes. The
economic turmoil has been compounded by poor tax
collection and slumping world prices for oil, one of Russia's
leading exports.

Reports of Chubais returning to the government came
after Kirienko met with Russia's leading bankers and
financial tycoons early last week to discuss ways to
stabilize the country's jittery markets. According to
Russian news reports, the financiers were pushing for
Chubais to coordinate the government's anti-crisis
measures.

The government is preparing to announce an anti-
crisis plan this to restore the confidence of investors,
Further budget cuts could be in the making. And the
government already is planning to slash spending by 3
percent of GDP.

Kirienko acknowledged that the program will be
"unpopular." But he said: "The world financial crisis has
fallen on fertile ground, namely the crisis of confidence in a
system that lives beyond its means."

Media reports that Chubais would be brought back into
the government sparked a rally on the country's stock
market, which rose 8 percent on 17 June. The Finance
Ministry also abruptly canceled its weekly treasury bill
auction. The move fueled speculation that the government
had found other sources of funds to redeem more than $1
billion dollars in maturing T-bills. And on 19 June, the
government launched a major Eurobond for a reported $2
billion, but the exact amount has not been
disclosed.

With Chubais back in government, markets are betting
that Russia will succeed in getting additional IMF support,
which investors believe is needed to halt speculation on
the ruble. Chubais has long played a key role in the
government's relations with the IMF and World Bank. His
latest appointment confirmed that this will continue.

Last month, Chubais was in Washington for "informal"
talks with senior officials from the IMF and U.S.
administration, as financial markets continued to plunge.
As he put it: "I happened to have close friendly relations
with top officials of financial bodies, such as the IMF and
the World Bank."

Analysts agree that Chubais has the political clout and
track record to do a deal with the IMF. In the words of Chris
Speckhard, an economist at the Russian brokerage Alfa
Kapital in Moscow: "He's someone they know and trust. His
ties with the final oligarchs also have a big influence on
the decision."

But there is also a possibility that putting Chubais in
charge of international financial institutions could divert
his attention from EES, which is at the center of a circle of
non-payments choking the economy.

As John Paul-Smith, a Russian strategist at Morgan
Stanley in London, put it: "The more time Chubais spends on
this, the worse it is for EES. Sorting out EES is one of the
biggest structural problems facing the government."
The author is a Moscow-based RFE/RL correspondent.